“Rolling” Reserve

A rolling reserve is what some banks use to cover their exposure to risk on accounts that are deemed to have higher than normal risk. This is a standard requirement from every offshore bank, and many domestic high risk processors. It works as such: for every deposit that is made to you from your sales, the bank will typically hold back 5% to 10% of that deposit, and will hold that 5%-10% for a period of 6 months, after which it is released back to you. It is called a rolling reserve then, because the reserve held from Month 1 is paid back in Month 7, and the reserve held back in Month 2 is paid back in Month 8, and so on.